The Pledged Assets to Secured Liabilities Ratio

question 45

Multiple Choice

The pledged assets to secured liabilities ratio

• A)Is calculated by dividing book value of secured liabilities by book value of pledged assets
• B)Can be calculated from the book value of assets and liabilities
• C)Is not relevant to secured creditors
• D)Can always be calculated from information provided in the financial statements
• E)Is a method of determining if the pledged assets of a debtor will provide adequate security for a creditor

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Definitions:

Objective Realities

External or physical realities that exist independently of personal feelings, opinions, or perceptions.

Subjective Feelings

Personal emotional experiences or sensations that are perceived by an individual, differing from objective measurements.

Autonomic Arousal

Involuntary physical responses of the autonomic nervous system to stimuli, including heart rate, breathing rate, and perspiration, typically associated with emotions like fear or excitement.

Primary Emotions

Basic emotions that are universally recognized and experienced by all humans, such as happiness, sadness, fear, and anger.